(INDIA) LIMITED · Capital Market Presentation 2019 IIL Brand Principle Always evolving in best...
Transcript of (INDIA) LIMITED · Capital Market Presentation 2019 IIL Brand Principle Always evolving in best...
Regd. & Corporate Office: 401-402, Lusa TowerAzadpur Commercial Complex, Delhi -110 033
Telefax: +9111 27679700-05 (6 Lines)email: [email protected]
www.insecticidesindia.com(IN : L65991 DLl996PLC083909
insecticides(INDIA) LIMITED
Ref: IILlSE/20191181211December 18,2019
The Manager
Symbol: INSECTICIDScrip Code: 532851
Listing Compliance DepartmentNational Stock Exchange of India Limited(Through EAPS)
Listing Compliance DepartmentBSE Limited(Through BSE Listing Centre)
Sub: Submission of Investors Presentation under the SEBI (Listing Obligations andDisclosures Requirements) Regulations, 2015
With reference to our letter No. IILlSE/20191161211 dated December 16, 2019 wherein we haveinformed the exchange having Investor Meet on December 18, 2019 at Grand Hyatt, Santacruz,Mumbai, in this regard we wish to submit the Investors Presentation pursuant to Regulation 30 ofSEB! (Listing Obligation and Disclosure Requirements) Regulations, 2015.
Kindly take the above information on record.
Thanking You,Yours Truly,For Insecticides (India) Limited
Encl: As Above
www.insecticidesindia.com
INDIAN FARMERS
WORLD CLASS TECHNOLOGYBRINGING
TO
Capital Markets Day Presentation 2019
Capital Market Presentation 2019
Disclaimer
2
This presentation contains statements that contain “forward looking statements” including, but without limitation,statements relating to the implementation of strategic initiatives, and other statements relating to Insecticides (India)Limited (“Insecticides India” or the Company) future business developments and economic performance.
While these forward looking statements indicate our assessment and future expectations concerning the development ofour business, a number of risks, uncertainties and other unknown factors could cause actual developments and results todiffer materially from our expectations.
These factors include, but are not limited to, general market, macro-economic, governmental and regulatory trends,movements in currency exchange and interest rates, competitive pressures, technological developments, changes in thefinancial conditions of third parties dealing with us, legislative developments, and other key factors that could affect ourbusiness and financial performance.
Insecticides (India) undertakes no obligation to publicly revise any forward looking statements to reflect future / likelyevents or circumstances.
Capital Market Presentation 2019
Agenda
3
Agenda Page No
Business Overview 4
Research and Development 13
Regulatory, Market Development and Manufacturing 42
Sales and Marketing 68
Procurement 89
Financial Performance 95
Corporate Social Responsibility 105
Growth Strategy and Outlook 111
1. Business OverviewMr. Rajesh Aggarwal
Managing Director
Capital Market Presentation 2019
IIL Mission and Vision
We work to make agriculture sustainable and profitable for our farmers, ensuring
food security for all living beings on earth, using simple and effective technologies
We will make this earth greener and cleaner through our work and our various
product portfolio that will become the first choice for all farmers worldwide
MissionOur purpose, what we are
VisionOur dream, our big contribution to
this planet earth
Capital Market Presentation 2019
Nation-wide strong customer reach under umbrella brand
‘Tractor Brand’
60,000+ retail outlets 5,000 Distributors
28 depots/branches500+ sales team
Business Overview
6
Headquarters - Delhi, started operations
in 2001-02
1 L
100+ Branded products20+ Technical
375+ SKUs
5 R&D centers – Developing a comprehensive range of agro chemical products
Engaged in the manufacturing and marketing of crop-
protection products
Four product categories: Insecticides, Herbicides,
Fungicides, Biologicals and Plant Growth
Regulators (PGRs)
State-of-the-art manufacturing facilities in Chopanki(Rajasthan), Samba &
Udhampur (Jammu & Kashmir) and Dahej (Gujarat)
Capital Market Presentation 2019
IIL Business Segments
Our BusinessDomestic
InstitutionalBrand
International
MaharatnaOther Brand
Agrochemicals Biological Products Household Products
Formulations
Technicals
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Capital Market Presentation 2019
Agriculture Sector in India
Post Independence
•Subsistence farming
•Stagnation in Agriculture
•Low growth in crop and grain production
1960-1980
•Green Revolution
•Farm machinery development
•High Yield Variety of seed, increased use of agrochemicals
•Achieved food security and reduced import of food grains
1980-2000
•Surplus production
•Economic reforms introduced: Encouragement to exports
2000’s
•MNC players brought in better technology and processes
•Higher production, supported by various government policies: national Horticulture Mission, Green Revolution in Eastern India
❖ With a population of 1.27 billion India is the world's second most populous country❖ India is the world's largest producer of milk, pulses and jute, and ranks as the second largest producer of rice,
wheat, sugarcane, groundnut, vegetables, fruit and cotton
Growth Drivers
❖ Government Policy Support: Increasing MSP, Exportsfacilitation and Promotion Schemes
❖ Innovation: Hyrbid and genetically modified seeds,mechanization and irrigation system development
❖ Market Demand: Increasing population and disposableincome
❖ Infrastructure: Large proportion of agricultural land andincreasing storage capacity
~USD 3 BnIndian
Agrochemicals Market Size - 2019
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Capital Market Presentation 2019
IIL Brand Principle
Always evolving in best interest of farmers
Continuously adopting innovative measures
Eco-friendly production
Advancing towards sustainable agricultural
practices
Ultra-modern automated manufacturing for consistent
quality and safety.
“To bring synergetic benefits to farmers by providing a comprehensive range of agro chemical product mix.”
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Capital Market Presentation 2019
IIL Evolution
10
2001
20022004 2005
20072008
Commenced operations
Chopanki(Rajasthan) formulation plant started
Samba (J&K) plant commissioned
Plant at Chopankigot ISO 9001: 2008 certificationSet up of R&D Lab
Listed on NSE & BSE
Chopanki Technical plant commenced
Samba plant expansion
Received OHSAS 18001 certification
201820122014 2015
2016
2017
Launched Akido, Sofia, Encounter & Hercules
Launched NUVAN with AMVAC, USA
Launched HAKAMA & PULSOR with NISSAN, JAPAN
Started product invention R&D center in JV with OAT AgiroCo., Ltd., JAPAN
Started new formulation unit at Chopanki
Launched Bio product, MYCORAJA
Bonus shares Issued
Follow-on QIPs
Tie-up with NIHON NOHYAKU, Japan for SUZUKA and HAKKO
Launched GREEN LABEL (BispyribacSodium 10% SC) manufactured in India for the first time
Launched revolutionary biological Soil Energiserproduct, KAYAKALP
2011Acquired MONOCIL from NOCIL Ltd.
2 new plants at Dahej & Udhampur
Capital Market Presentation 2019
IIL Evolving in All Directions
Sales & Market development
Branding
International Tie ups and collaborations
Marketing
NABL QC Labs
In-house R&D Centre
JV with OAT Agrio Co.,Japanfor dedicated invention
R&D center
R&D
5 Formulation plants
2 Technical Synthesis plantsBiological manufacturing plant*
Manufacturing
Emphasis on field activities
Farmer awareness
Salesforce training
Development & Training
*under toll arrangement
Innovate,
Integrateand Lead
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Capital Market Presentation 2019
R&D Overview
▪ There is definite need to innovate and focus on new products / molecules to stay relevant in the competitive and dynamic landscape
▪ Chopanki was the IIL’s first R&D centre established in 2004 and as of today we have, 5 R&D centres with 75+ well experienced scientists
▪ IIL has built State-of-the-art R&D centre for Technicals, Formulations, Reverse Engineering and Biologicals
▪ R&D centres have delivered many successful product such as Green Label, Hercules, Encounter, Sofia
▪ Many products are in pipeline, our R&D remains fully committed and working on the products to be launched in the medium term and long term
▪ Investing in R&D today for a better tomorrow and this will allow IIL to stay ahead of its competition in the long run
R & D has played a pivotal role in transforming IIL business and will continue to drive future growth
R&D Centre, Samba, J&K
In House R&D Centre, Chopanki, Rajasthan
Product Invention R&D Centre in JV with OAT
AGRIO, Chopanki, Rajasthan
Formulation R&D Center, Dahej, Gujarat
Biological R&D Centre, Shamli, UP
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Dr. Kallolmay BiswasGM – R&D
OAT & IIL India Laboratories
2. Research and Development
Mr. Kazuya KishimotoMD & CEO
OAT & IIL India Laboratories
Dr. LC RohelaSr. GM - QA
Dr. Mukesh KumarGM – R&D
Mr. Shailesh PatelDGM –R&D
2.1 R&D - ChopankiDr. Mukesh Kumar
GM – R&D
Capital Market Presentation 2019
Vision of R&D Centre - Chopanki
▪ Chopanki was the IIL’s first R&D centre and was established in 2004
▪ Focus on reverse engineering of off patented products
▪ Development of New Formulations; ecofriendly & ready-mix solutions for farmers
▪ Development of New Technicals (Active Ingredients)
▪ Optimizing parameters for process of technicals for cost reduction
▪ Work on effluent treatment to minimize cost for it
▪ Replacement of toxic solvent
▪ To work with DSIR, Ministry of Science and Technology to contribute towards the growth of Indian agriculture
▪ Contribute towards the growth of Indian agriculture
▪ Process development for import substitution
▪ Registration of the products
2004Established
Chopanki, RajasthanLocation
In-House R&D Centre recognized by DSIR,
Ministry of Science and Technology, New Delhi
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Capital Market Presentation 2019
R&D Infrastructure and Team – Chopanki
▪ Well-designed instrument and process lab
▪ International exposure to R&D scientists
▪ Participation in National and International conference
▪ Patent granted for import substitute products like Imidacloprid and Acetamiprid, MNIO and PMIDA
▪ All lab procedures are carried out as per GLP guidelines
▪ Pre-inspection audit for GLP recognition done
R&D Equivalent to International Standards
Team• Experienced and dedicated scientist in R&D
• Team of 12 employees at Chopanki R&D centre
• Doctorate – 2
• Post Graduate – 6
• Graduates - 4
R&D Equipment• Well furnished and best- equipped R&D laboratory
with all safety measures
• LC-MS: 1, HPLC: 3, GC –MS : 1, GLC :3 , Prep-HPLC : 1, FTIR: 1, UV-visible spectrophotometer: 1
• R&D is well equipped with all utilities. We have 6 fumehoods where 12 reactions can be carried out simultaneously
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Capital Market Presentation 2019
Certification Framework
ISO 9001:2015Quality Management
System
ISO 14001:2015Environment
Management System
ISO 45001: 2018Occupational Health &
Safety Management System
Certifications and Recognitions – Chopanki
• Recognized by DSIR: Since2005
• IIL In-House R&D Centre recognized by DSIR, Ministry of Science and Technology, New Delhi
• NABL Accreditation of QC Labs at Chopanki
Recognitions
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Capital Market Presentation 2019
Process of Scaling Up from Lab to Commercial
Lab Scale
• Gram levelKilo Lab
Pilot Plant Scale
Commercial Scale
In House R&D Labs for Testing and Commercializing Potential Products at a Low Cost and Shorter Turnaround Time
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Capital Market Presentation 2019
Achievements – Chopanki
Achievements
Products Developed Commercialized
Insecticides 26 17
Herbicides 16 11
Fungicides 9 3
Total 51 31
Strategy for Process Improvement
1. Quality Improvement
2. Remove Cumbersome Process
3. Removal of Multiple Solvents
4. Make Processes - Simple, Shorter and Cost-Effective
Way ForwardIdentified new products to meet farmer requirements and 15 products are under
development
Key Technical Products Developed Contributing to Maharatna
Technicals Chlorpyrifos Thiamethoxam Diafenthiuron Acetamiprid
Brands
Lethal Range of Products
Bheema Hercules Hercules
Bheema Super Logo/ Gama Sharp
Arrow
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Mr. Shailesh PatelDGM –R&D
2.2 R&D - Dahej
Capital Market Presentation 2019
▪ Process improvement of existing products withrespect to cost
▪ To develop the process for new products/intermediates in terms of competitive cost, energyefficient and environmental friendly to stay ahead offarmer’s requirement and market competition
▪ Formulation development
▪ Backward integration
▪ Contribute for safe and eco friendly practices inagriculture
▪ Adopt and implement new research technology
R&D Objectives and Capabilities – Dahej
Key Objectives
Unit Process
GrignardFriedel-Craft
akn/acn
Reduction (Using Pd/C,
Rany Ni, Sodium
borohydride)
Pressure reaction
(Hydrolysis, Hydrogenatio
n)
Telomerization / Cyclization
Halogenation (Cl2n, Br2n, Fn)
Phosgenation (Using
Triphosgene)Diazotization
Phosphorus / Sulfur
chemistry
▪ Design and Development
▪ Project approval to commercialization
▪ Product registration (CIB/Export)
Capabilities
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Capital Market Presentation 2019
R&D Infrastructure and Team – Dahej
Dahej R&D Overview
▪ Established in 2014
▪ Well equipped with latest technology and facility
▪ New molecules development, process scale up andtechnology transfer to plant
▪ Impurities synthesis and characterization
▪ Plant trouble shooting/support
▪ Five batch analysis as per GLP guidelines
Team• Team of 10 employees at Dahej R&D centre
• Doctorate – 1
• Post Graduate – 7
• Others - 2
R&D Equipment
• 2 Labs with fume hoods and all required facilities.
• Separate dedicated ADL facility with GC, HPLC etc.
Capital Market Presentation 2019
Backward Integration – Dahej
Objectives:
1. Independency of the key raw materials procurement
2. Cost benefits: Reduce the cost of purchasing the raw materials. Will also result in reduction ofwastages, transport costs and other costs
3. Increased control: Control the supply chain process in a more efficient manner
Six intermediaries developed to get independency of the key raw materials and realize cost benefits
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Capital Market Presentation 2019
Achievements – Dahej
Technicals
Products Developed Commercialized
Insecticides 4 2
Herbicides 7 4
Fungicides 2 2
Total 13 8
Key Products Developed Contributing to Maharatna
Formulations for Exports
Products Developed Commercialized
Insecticides 11 8
Herbicides 5 4
Total 16 12
Technicals Imazethapyr Bispyribac Sodium Glyphosate Pretilachlor
Brands
Selector Green Label Hijack Racer
Hijack Super Super Racer
Flight 71
Key Products Developed Contributing to Maharatna
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Dr. LC RohelaSr. GM - QA
2.3 R&D - Biological and Patents
Capital Market Presentation 2019
Why Biologicals?
▪ Modern science is 200 years old while nature science is 3 billion years old
▪ Nature science wonders- Sequoia tree 100ft wide, 100ft tall withstand 100 tons of load in structure made of cellulose -strength is more than steel
▪ Integrated Crop Management (ICM) and Soil health - Low toxicity to humans and nontarget insects
Modern science following nature science path:
• Biopolymers Material science
• Penicillin to cefixime etc., Taxol to Docetaxil, Neutraceuticals- Plant DerivedMedicine
• Herbal blendsCosmetics
• Pyrethin to synthetic pyrethroids
• Nerotoxins to insecticides Agriculture
Recent trends – Biosimilar molecules in medicines, biosimilar peptides derived from spider venom as effective as agrochemicals with zero harvest waiting period Is On A Rising Trend
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Capital Market Presentation 2019
Global Bio-Control Market
Future Market Drivers
• Fewer new synthetic crop protection active ingredients will emerge - too expensive
• Improved market access for bio pesticides and bio stimulants
• Federal registration guideline for bio stimulants in EU & USA will make market more attractive
• ICM + Soil health
• MNC’s in last 4 years have acquired Agri biological products manufacturing companies
1993 1999 2005 2009 2012 2014 2015
100
250
500
1,000
1,500
2,000
3,000
4,000
2020
Global Market Potential – USD millions
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Capital Market Presentation 2019
Biological Facility Overview
Lab Facility: Aseptic lab, autoclaves , microscopes, laminar air flow, incubator, cryo centrifuge
Location: Shamli, Uttar Pradesh
Biological Team: Doctorate – 4 , Post Graduate - 1 , Graduate - 333 Cr
Biological Revenue FY2019
Total Product range
• Biofertilizer, Organic Manure, Soil Enrichmentand Biostimulants
• Projected reduction in chemical fertilizers by25%
Business Potential
• Current CAGR 10-15% in global Agri bio business
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Capital Market Presentation 2019
IIL Biological Journey… Long Way to Go…
Products Commercialized
• Vascular Arbuscular Mycorrhizae based fungal formulation
MYCORAJA
•A biologically fortified PGR
PRIME GOLD
•A liquid organic manure
MILSTIM
•For increasing root nodule formulation in pulses
ROOT BEAD
•A consortia of micro organisms for soil enrichment . It has potential for rejuvenating soil and has the capacity to protect plants from soil borne pathogens
KAYAKALP
Products in Pipeline
1. Kayakalp PRO: Kayakalp application was on farmfermentation for 6 days. Kayakalp Pro designedto 12 hrs on farm fermentation. Capacity for soilrejuvenation and controlling soil bornepathogens
2. Zinc Solubilising Bacteria: Under launching,capable of fortifying produce with Zinc and willsupport combating diabetes
3. Glomus Arbuscular Mycorrhizae: Production byroot organ culture technique. Developing rootsin jars in aspetic conditions with mycorrhizae.Very good activity for transfer of nutrients toroots. Good export potential to USA, EU,Australia
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Capital Market Presentation 2019
IIL Formulation Products- Agrochemicals
No. Of Formulations
CommercializedUnder
Development
Single AI 11 1
Combinations 4 19
Tank Mix Adjuvants
3 2
• Design Of Formulation
• Activity by contact, systemic or stomach
• Single or multiple activities
• Threats• Hydrophobic agrochemical, 50-250g to spread over 1 acre in
terms of land and 20-30 acres when calculated on leaf area in 1 acre
• Uniform distribution up to target
• Synergism establishment in case of combinations
• Solutions – Micronization, surface chemistry aided by suitably designed surfactants. Tank mix adjuvants
• Types Of Formulations- EC/SC/WP/WG/CGR/SC/CS/EW/SE/ ME
Development Support
• Developing synergistic combination formulations performing multiple actions through different modes ofaction with increased bio efficacy duly supported by bio- efficacy team
• New generation formulation in SC/SE/CS/SG/ME form which are farmer friendly
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Capital Market Presentation 2019
Patents
Intellectual property of developed innovative products / process preserved through patents
Biotech Formulation Synthesis New A.I.
Patents Granted - 3 4 -
Patents due for Grant 1 12 1 8
Patent ApplicationProcess
Patentability Search :
• Novelty, inventive step
Freedom to Operate (FTO) (Infringement search) :
• To assess any possible modification to avoid infringement
Patent Validity Search :
• To gauge the validity of the claims in a granted patent
Team
In-house: Researchers + Patent Attorney
External Support: IPR Law firms
22Patents Pending
7Patents Granted
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Capital Market Presentation 2019
Quality Assurance
Product Activity
Product Design
Lab Scale Preparation
Bio Efficacy Evaluation
Commercial Production
Methodology
Specs of inputs - Plant & Machinery,
Packing material Finished goods
Quality Manual
Aim –
Target – Adherence to quality policy
Advantage – Farmer’s satisfaction and brand
development
Evaluation Criteria
✓Standard operating procedure
✓QC-RM/PM/FG
✓Market complaints
✓Corrective Action Preventive Action (CAPA)
Well Defined Process
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2.4 R&D - OAT & IIL IndiaMr. Kazuya Kishimoto
MD & CEO OAT & IIL India Laboratories
Capital Market Presentation 2019
Indian Experience
Indian Experience on R&D Relationship with IIL and Experience
❖ India is suitable for R&D with nearly all crops and seasons
❖ Man-power is good and available reasonably
❖ Efficacy testing is possible round the year
❖ Easy to do field trails due to IIL’s pan-India presence
❖ IIL’s long term vision for Research is a major
reason for association
❖ OAT and IIL will bring the new chemistry with least
possible cost
❖ Relationship with IIL has been great in these years
and look forward to work on many more ventures
❖ Management is aggressive and fast decision is one
of core strength’s
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Capital Market Presentation 2019
OAT & IIL India
Vision
History
❖ Becoming a first-class research & development centre, which
continuously invent/develop new molecules to contribute to the
world crop protection markets (including India & Japan)
❖ Will target to be a first company to invent an "Invent in India“ first
pesticide
❖ Established on 6th March, 2013 with approximately 50 employees,
consisting of chemists/biologists and supporting staffs.
❖ 4 chemistry laboratories
❖ Total number is increased to 60 as on Nov, 2019
35
2.5 R&D - OAT & IIL IndiaDr. Kallolmay Biswas
GM – R&D OAT & IIL India
Laboratories
Capital Market Presentation 2019
OAT & IIL Journey
2013
•Establishment of OIL (OAT& IIL Joint Venture)
2014
•Inauguration of R&D centre
2016
•Start-up CRO Business
2018
•Expansion of existing green house facilities
2019
•Opening of a new synthesis laboratory
•Start-up of a new formulation plant
JapanIndia
Joint Venture Company
37
Capital Market Presentation 2019
Mission
Mission Invention at R&D Centre
❖ Contribute to sound crop production through novel
sophisticated crop protection agents and support the rich
diet and health of people
❖ Creation of new agrochemicals with high safety to
mammals, animals and non-target organisms and no
impact to environment
❖ The residue of this product will be insignificant so that the
crop can be used for consumption even after one day of
spray
❖ First time, a Japanese company established such
facility in the field of agro-chemicals in India
❖ Approved by DSIR, Ministry of Science and
Technology
❖ 45+ scientists are conducting research
❖ Lead by renowned scientist with more than 20
year of experiences in the field of agrochemicals
❖ We have 5 Japanese leading the R&D centre
38
Capital Market Presentation 2019
Synthesis and Biology Lab
West Building - Synthesis Lab
East Building - Biology Lab
39
Capital Market Presentation 2019
Invention at R&D Centre
Laboratories
Synthesis
4 synthesis laboratories
Analytical
Equipped with latest machines andequipment like NMR and UPLC-MS toanalyze and characterize newmolecules
Biological
Ultra modern green houses to conduct effective in-house testingBreeding rooms, bio-assay rooms and spray cabinets
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Capital Market Presentation 2019
New Formulation Facility - Chopanki, Rajasthan
• Plant Growth Regulator (PGR) which effects various stages of
development of plants
• Stimulation of activity of enzymes resulting in faster cytoplasmic
streaming, more efficient photosynthesis and mineral uptake
Advantages:
• Enhances germination and rooting
• Stimulates Vegetative growth and Flower bud development
• Accelerates Pollen germination
• Improves health as well as quality of crops
• Resulting in higher yield which gives more profit to farmers
Formulation PlantChaperone
Sodium Para - Nitrophenolate 0.3% SL
Way Forward
▪ Develop new generation products and new generation formulations
▪ The flexible business model has enabled us to deliver good outcomes in a relatively short period of time
▪ The team is now concentrating on cost reduction, customer friendly and environment safe products
41
3. Regulatory, Market Development and Manufacturing
Mr. Sanjay VatsVice President
Mr. Sanjay SinghGM – Market Development
Mr. Bhupendra TiwariHead Manufacturing
Mr. Sanjay VatsVice President
3.1 Regulatory
Capital Market Presentation 2019
Regulatory Environment in India
❖ India is one of the most dynamic generic pesticidemanufacturers in world and is fourth largest pesticidemanufacturer after China, USA and Japan
❖ Use of pesticides in India is regulated by theInsecticides Act, 1968 and Rules, 1971
❖ All pesticides (Insecticides, Fungicides, Herbicides,Public Health insecticides) must be registered withInsecticides Board & Registration Committee (CIB &RC)
Regulatory Environment in India Registration Process
Registration is done under various sections of Insecticides Act, 1968
Application for the registration is prepared in Form-I and submitted online
•All requisite data (Chemistry, Toxicology, Bio-efficacy and Packaging) as per approved latest guidelines of CIB & RC is submitted
Scrutiny of submitted data by concerned scientists/technical officers to check data conformity
Registration approval by the Registration Committee
3
4
1
2
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Capital Market Presentation 2019
Registration Categories and Challenges
Registration Categories and Timeframe
9 (3)First-time manufactured/imported in India
9 (4) Already registered pesticides
5-6Years
Data generation: 2.5 - 3 Years CIB & RC: 2-3 Years
2.5-3Years
Technical: 2.5 – 3 Years Formulations: 1-1.5 Years
Registration Process Challenges
❖ Immense data requirement for registering newproduct in India
❖ Slow process to scrutinise the application resultingdelay in registration approval
Dedicated Team to Speed Up the Process
Team
• 6 experienced members specialized in different streams and following up with regulatory departments:
• Toxicology
• Chemistry
• Bio Efficacy
• Packaging
Original Registration
Me-too Registration
45
Capital Market Presentation 2019
IIL 9(3) Registrations
Name of the Product Product Category Brand Name
Bispyribac Sodium Technical 95% Min. Technical -
Bispyribac Sodium 10% SC Formulation Green Label
Imazethapyr Technical 93% Min Technical -
Bifenthrin 8%SC Formulation To be launched
Metsulfuron Methyl 20%WG Formulation To be launched
Diafenthiuron 40.1% + Acetamiprid 3.9%WP Formulation Hercules
Emamectin Benzoate 3% + Thiamethoxam 12%WG Formulation Encounter
Hexaconazole 4% + Carbandazim 16%SC Formulation Sofia
Buprofezin 22% + Fipronil 3%SC Formulation Aikido
Bifenthrin 3% + Chlorpyriphos 30%EC Formulation Lethal Gold
Bifenthrin 8.8%CS Formulation Rockstar
Cyenopyrafen 30%SC Formulation Kunoichi
Technicals Formulations
2 10
IIL 9(3) Registrations
46
Capital Market Presentation 2019
IIL strategic focus on developing newer technicals and products which can be registered under 9 (3) category and can contribute towards
growth of Maharatna Products
IIL Number of Registrations
❖Category 9(3) : 12 registration certificates approved by CIB & RC
❖Category 9(4) : 47 technical and 225 of formulation registration certificates approved by CIB & RC
Year 9(3) Registrations 9(4) Registrations
2019-20 02 12
2018-19 05 29
2017-18 02 30
2016-17 02 26
2015-16 - 35
Upto 2014 01 140
9(3) Registrations 9(4) Registrations
22 06
Year-wise Registration Registration Pipeline
47
Mr. Sanjay SinghGM – Market Development
3.2 Market Development
Capital Market Presentation 2019
A trust of decades
Umbrella Brand for end to end solutions
Farmers’ first choice pan India
Symbol of Confidence
Tractor Brand – Farmer’s Choice
49
Capital Market Presentation 2019
Product Selection & Offering
•Identification of crop specific farmers problems
•Weed, Insect, Pest & Diseases
ProblemIdentification
•Market research on current solutions available
•Market size of opportunities
Market Research •Look forward to
International tie-up
•In-house R & D-product selection
Find Solution
•Official data generation to register the products by Registration team
Registration •Launch product in the Market
•Educate farmers about its application and benefits
Commercialization
• In-house R & D- product selection • Data generation in different agro- climatic zone vis a vis with current
solution to identify the bio-efficacy superiority- Involvement of national and state level team
• Replications from trials plot to pilot plot to reconfirm the findings
Continuous process from product identification to commercialization and offer complete solution to farmers
50
Capital Market Presentation 2019
Global Partners and Achievements
Nissan, Japan
Marketing Tie up for specialty products Fungicide PULSOR (2012), Selective Herbicide
HAKAMA (2012) andMiticide KUNOICHI (Oct 2019)
Pulsor Hakama Kunoichi
5.0
44.4
100.0
FY13 H1FY20 FY23E
7.826.0
100.0
FY13 H1FY20 FY23E
14.0
60.0
FY20E FY23E
1 New combination to be launched 1 New variant and 3 New combinations to be launched
(All figures in Rs. Crore)
51* Projections are based on company internal estimates 51
Capital Market Presentation 2019
Global Partners and Achievements
52
Momentive, USA
OAT Agrio, Japan Nihon, Japan
AMVAC, USA
Tie up with MOMENTIVE Performance Material INC, USA for
AGRO SPRED MAX (2016) for silicone based super spreader
Technical Collaboration for manufacturing and marketing
of THIMET (2006) & NUVAN (2012)
Tie up for SUZUKA (Flubendiamide) (2016) AIKIDO (2018) & HAKKO (Buprofezin)
(2016)
JV to set up a dedicated R&D Centre in India to invent new
agrochemical molecules.PGR ROOT BEAD (2017)
PGR CHAPERONE (Dec 2019)
52
Capital Market Presentation 2019
International Tie-ups and Timeline
2016
•SUZUKA(Insecticide)Nihon, Japan
2016
•HAKKO (Insecticide)Nihon, Japan
2017
•ROOT BEAD(PGR)OAT Agrio, JAPAN
2018
•AIKIDO(Insecticide)Nihon, Japan
2019
•KUNOICHI (Miticide)Nissan, Japan (Oct. 2019)
2019
•CHAPERONE (PGR)OAT Agrio, Japan (Dec. 2019)
2006
•THIMET (Insecticide)AMVAC, USA
2012
•NUVAN(Insecticide)AMVAC, USA
2012
•HAKAMA(Herbicide)Nissan, Japan
2012
•PULSOR (Fungicide)Nissan, Japan
2016
•AGRO SPRED MAX (Super Spreader)Momentive, USA
53
Capital Market Presentation 2019
Innovative Technology – Select Success Stories
Root bead : Nodule enhancer in pulse crops
Pulsor :A unique product for rice sheath blight-Best solution available in India
Hakama : Strong graminicide
Agrospred Max : A silicon based spreading agent- need for the farmers
Kunoichi :A strongest miticide from Nissan kills all the stages of mites including eggs.
Hercules :A promising product for cotton to control white fly-most damaging pest
Encounter :A perfect product for simultaneous solution of Loopers and Tea Mosqito bug in tea
Sofia :Established as the first spray of crop protection against various diseases
Many more examples are the success stories of IIL and the journey continues…
54
Capital Market Presentation 2019
Encounter
Sofia
Key Products – Sales and Forecasts
13.8 14.7
50.0
FY19 H1FY20 FY23E
15.66.2
50.0
FY19 H1FY20 FY23E
11.332.2
100.0
FY19 H1FY20 FY23E
6.0
50.0
FY20E FY23E
(All figures in Rs. Crore)
Hercules
Lethal Gold
* Projections are based on company internal estimates 55
Capital Market Presentation 2019
Team• Head Office - Delhi
• H.O. Market Development Team - 5
• Network Distributed in Zones:
• North, East, South, West
• Market Development Team:
• Pay Roll: 72
• Third Party Roll: 600-850
Market Development – Structure and Manpower
North ZonePay Roll : 18TPR : 100-150
East ZonePay Roll : 10TPR : 150-200
South ZonePay Roll : 23TPR : 200-300
West ZonePay Roll : 21TPR : 150-200
56
Capital Market Presentation 2019
Market Development Activities
Demonstrations: Crops vs Pest Specific Field Days : Seeing & Believing
Farmer Meetings: Solution for specific problems Mega Farmer Meetings: Crop solution
57
Capital Market Presentation 2019
Market Development Activities
Intensive Consumer Awareness Program Dealers Training Program
Market Development Activities & Large Farmer Contact
Mega Meeting
Farmer Meetings
Group Meetings
A V Van Campaign
Demo Field DaysBalloon Show
Total Farmers contact
Total 750+ 1,000+ 20,000+ 6,500+ 5,000+ 2,500+ 250+ 20+ Lakhs
Engaged with 20+ lakh farmers through Market Development Activities & Farmer Contact Initiative
58
Capital Market Presentation 2019
Market Development Activities
Social Media: WhatsApp groups of Farmers across country
Mass Media Campaign: News Paper, Radio and TV campaign
Android App and WhatsApp Group for Farmers and Dealers for product information
59
3.3 ManufacturingMr. Bhupendra TiwariHead Manufacturing
Capital Market Presentation 2019
Manufacturing Sites – Formulations
Unit 1: Chopanki, Rajasthan
Unit 3: Dahej, Gujarat
Unit 4: Samba, J&K
Unit 5: Udhampur, J&KUnit 2: Chopanki, Rajasthan
61
Capital Market Presentation 2019
Manufacturing Capacity and Formulations
Aggregate Installed Capacity
19,400 KLPA
Liquid Formulation
75,750 MTPA
Granules Formulation
18,770 MTPA
Powder Formulation
13,800 MTPA
Technical Garde
New Generation Formulations
❖ New generation formulations are effective, safer,
easier to handle and environment friendly
Water Dispersible Granules (WG)
Suspension Concentrate (SC)
Concentrated Emulsion (CE)Microemulsion
(ME)
Controlled Release Formulation
(CR)
Suspo-emulsion Formulation (SE)
62
Capital Market Presentation 2019
Manufacturing Capabilities – Formulations
Automation
❖ Most of the plants are having automation in
formulation and packaging
Automatic formulation and packing lines for powder, granules and liquid products
Quality Check Laboratory
❖ All factory sites are having well established test lab with ultra modern facilities and experienced chemists to check
❖ Raw materials
❖ Intermediates
❖ Finish goods
❖ Packing materials
❖ Environmental samples
❖ NABL Accreditation at Chopanki
Aim
63
Capital Market Presentation 2019
Manufacturing Sites – Technicals
Unit 2:Dahej, Gujarat(Technical Production started in 2011)
Unit 1: Chopanki, Rajasthan(Technical Production started in 2007)
Aggregate Installed Capacity
13,800 MTPA
Technical Garde64
Capital Market Presentation 2019
Manufacturing Capabilities – Technicals
▪ Multi-products plant and multipurpose lines
▪ Self dependent in utilities
▪ Backward integration for products
▪ Independent quality control
▪ Remarkable R&D support for process improvement, validation of new products & innovative ideas
▪ Adaptability of latest technology in term of cost & environment friendliness
▪ State of art Effluent Treatment facility
▪ Trained safety team with training facility
▪ Higher capacity utilization
▪ Efficient regulatory and technical team
▪ Due to backward integration less dependency on suppliers
▪ Low site operating cost due to expansion on same site
Team and Infrastructure
Characteristics
Chopanki• Regular Employee : 100
• Contractual : 150
Dahej• Regular Employee : 300
• Contractual : 300
• Total area : 50 Acre
65
Capital Market Presentation 2019
Products Manufactured
Insecticide & Fungicide Plant - Dahej
Product Brand
Chlorpyrifos Lethal Range of Products
Cartap hydrochloride Indan
Thiophanate Methyl Prism
Diafenthiuron Hercules, Logo/ Gama
Tricyclazole Force11
Acetamiprid Hercules, Sharp
Herbicide Plant - Dahej
Product Brand
Atrazine Strike
Pretilachlor Super Racer, Racer
Metribuzin Anchor
Sulfosulfuron Kaiser
Imazethapyr Selector
Bispyribac sodium Green Label
Diuron Duron
Clodinafop propargyl Omega
Cloquintocet-mexyl -
Capacity Expansion Plans To Manufacture Technicals
❖Target to add 5 new technical in 2020
❖Target to backward integrate intermediates for three technicals
Product Brand
Lambda Cyhalothrin Bravo, Metacil
Bifenthrin Super Star, Lethal Gold
ThiamethoxamArrow, Bheema, Bheema Super, Encounter
Coded Fungicide Fungicide for CRAMs
Insecticide & Fungicide Plant - Chopanki
66
Capital Market Presentation 2019
Expansion and Growth Plans
Backward Integration Plan at Dahej and Chopanki
▪ Developed land is readily available for expansion
▪ Due to geographical location of Dahej, logistics & easy availability of raw material will help in cost reduction as compared to other part of India
▪ Gearing of ourselves to meet future demands of new customers and enhance overall profitability
Advantages
▪ Lower dependency on supplier
▪ Low manufacturing cost of finished products
▪ Reduction in overhead cost per tonne
▪ Optimum utilisation of existing utilities
▪ Better control on process
▪ Lower inventory build-up and shorter working capital cycle
Setting up “SEZ” unit at Dahej
▪ We are coming with export oriented unit at SEZ Dahejfor formulation of Insecticides & herbicides
▪ Production is expected to commence in February 2020
▪ This will enable us to multiplying our exports and meet our FY2023 targets
Advantages
▪ 10-year tax holiday in a block of the first 20 years
▪ Exemption from duties on all imports for project development
▪ Exemption from GST on domestic sourcing of capital goods for project
▪ Exemption from import duty, GST and other taxes
67
4. Sales & Marketing
Mr. VK GargVice President
Dr. Arun KohliVice President –
Institutional Sales
Mr. Shrikant SatweHead - International
Business
4.1 Sales & Marketing –Domestic Sales
Mr. VK GargVice President
Capital Market Presentation 2019
Agricultural Production vs Pesticides Consumption
CountryWorld rank in
AgricultureProduction
Agriculture Production ($ bn)
Pesticide Use(tons, 2017)
Number of Pesticidemolecules registered
China 1 978 1,763,000 681
India 2 394 52,750 282
EU 3 269 362,421 467
USA 4 164 407,779 481
Brazil 7 81 377,176 477
Japan 9 58 52,248 583
Thailand 13 41 35,287 364
Australia 17 37 63,416 561
Argentina 21 32 196,009 414
Important Observations:• India, the second largest agricultural producer, uses much less pesticides both in volume and in variety• “Indian farmers use excessive pesticides” is a mischievous propaganda by foreign funded environmental activists
to malign Indian agriculture in the international trade
“ FARMERS WAS THE FIRST SOCIAL PERSON ON EARTH”
Source: Crop Care Federation of India
70
Capital Market Presentation 2019
Region-wise Pesticides Ratio
REGION 2002 2018 REMARKS
East Zone 13% 20%Generic dominant and
fast-growing market
West Zone 20% 25 %
Combination of Generic &
Research and fast-
growing Market
North
Zone30 % 25%
Research dominant and
growing in Value
South
Zone37 % 30%
Combination of Generic &
Research And growing in
value
REGION
IIL Share in B2c
Sales
2018-19
Market Share
2018-19
East Zone 27% 6%
West Zone 22% 5%
North Zone 23% 6%
South Zone 28% 5%
IIL presence is well diversified across states and zones
71
Capital Market Presentation 2019
Sales Team & Strategy
500 + Team with 600-850 TPR
Team Farmer Engagement for the Product Launch
Designation Strength
Vice President 4
Marketing Manager 2
Zonal manager 7
Regional Manager 38
Area Manager 54
Sales Executive 43
Sales Officer 115
Sales Representative 193
Development team 72
Engaging farmers and channel partners from the
initial trials
Working with the farmers at every stage of product
application
Showing results practically to farmers by
demos
Continuous recall by PoPs, AV vans, Electronic media
and digital campaigns
Collecting the feedbacks and maintaining the data
for next season
Strategy to move to Blue Ocean
72
Capital Market Presentation 2019
IIL Brand Business Strength
❖ Farmer centric approach
❖ Strong Brand Image and Recallo Old brands: Lethal, Lethal Super, Thimet, Monocil, Victor, Sharp, Hijack And Racer
o New brands: Pulsor, Xplode, Nuvan, Mycoraja, Green Label, Hijack Super, Hakama, Super Racer, Lethal Gold, Hercules, Sofia, And Kunoichi
❖ PAN India Quality & Stable networko Depots : 28 o Distributors: 5,000 o Dealers: 60,000
❖ Strong market development team and robust product identification to commercialization process
73
Capital Market Presentation 2019
5- Way Test
Strengthen the team
Strengthen the market
Strengthen the field
Strengthen the product portfolio
Strengthen the system and policy
74
4.2 Sales & Marketing –Institutional Sales
Dr. Arun KohliVice President –
Institutional Sales
Capital Market Presentation 2019
Institutional Sales Contribution
2016-17 2017-18 2018-19
Institutional Sales Trend
B2B Institutional Sales
B2B, 31%
Others, 69%
FY2019 Revenue
76
Constant growth in sales over the years
Capital Market Presentation 2019
B2B Capabilities and Key Products
Insecticides Fungicides HerbicidesHousehold Insecticides
ACETAMIPRID TRICYCLAZOLE GLYPHOSATE D-TRANS ALLETHRIN
LAMBDA CYHALOTHRIN THIOPHANATE ATRAZINE
IMIDACLOPRID METALAXYL IMAZETHAPYR
BIFENTHRIN MYCLOBUTANIL PRETILACHLOR
DIAFENTHIURONBISPYRIBAC SODIUM
CHLORPYRIFOS SULFOSULFURON
CARTAP CLADINOFOP
QUIZALOFOP Bulk
Diversified Range of ProductsIIL Capabilities
▪ Two synthesis plants
▪ Five formulation plants
▪ Capability to produce complex molecules
▪ R&D support
▪ Good brand perception with large customers
▪ Good quality product
▪ Timely execution capabilities
77
Capital Market Presentation 2019
Top Products & Customers
Top 10 Products – FY2019 Top Customers – FY2019
Gly
ph
osa
te
Pre
tila
chlo
r
Lam
bd
a
Bif
en
thri
n
Th
iam
eth
ox
am
Art
razi
ne
Th
iop
han
ate
Me
thyl
Qu
izal
ofo
p
Car
tap
Tri
cycl
azo
le
UP
L
Will
wo
od
Ch
em
ical
s
Par
ijat
Ind
ust
rie
s
Cry
stal
Cro
pP
rote
ctio
n
Dh
anu
ka A
gri
tech
IFFC
O
Ind
ofi
l In
du
stri
es
Bh
arat
Gro
up
Su
mit
om
o C
he
mic
als
Ad
ama
Zu
ari A
gro
78
Capital Market Presentation 2019
B2B Strategy and Outlook
Strategy
▪ Adding new chemistries and molecules
▪ Focus on complex molecules with low competition
▪ Identifying the products getting off patented and focus on reverse engineering
▪ Have large scope for sales to new and existing customers
▪ Pan India presence already and plan is to go deeper in the market through strong sales and distribution network
Future Scope
▪ Agriculture markets to grow by double digit
▪ Commodity prices are high
▪ Farmers are prepared to invest in Agri Input/agrochemicals
▪ The changed product portfolio caters to all segment
▪ We are future ready to cater to customers
▪ Our Business relations with our customers
▪ Dual working on buying and selling
▪ Technology transfers and sharing
79
4.3 Sales & Marketing –International Sales
Mr. Shrikant SatweHead - International
Business
Capital Market Presentation 2019
B2B International Sales
Highlights
• IBD grown at 82% CAGR between FY16-19
• IBD contribute 4 % of total IIL Sales
• Presence in 18 countries with 42 customers
• APAC contributed maximum ( 40%) followed by Africa & ME
• Herbicides Contributed maximum followed by Insecticides & Fungicides
• Formulation contribute > 90% of the business
• WDG ; EC formulations maximum contributed
• 80% business from IIL core products
• “Trading House Status” confirmed in FY18
International Sales Trend (Rs. Cr.)
12 12
34
60
FY16 FY17 FY18 FY19
81
Capital Market Presentation 2019
Market Expansion Strategy
Cost Efficient Generic
Supplier having Competency in
adding Value Chain
Volume & Margin
Expansion through
Long Term Supply
Contracts &
Sustainable Relationship
Differentiated Product Mix to Existing & New
Customers
Geographical Presence through Regulatory
compliance
Leveraging R & D Capability to Develop
Off patent Product/Chemistries
Growing Outsourcing market Opportunities
Through CSM business
Value added Product Portfolio like Biocides; Intermediates & Public
health Products
82
Capital Market Presentation 2019
Key Products : Data in Progress
Insecticides Herbicides Fungicides
❖ Acetamiprid
❖ Thiamethoxam
❖ Dinotefuran
❖ Diafenthiuron
❖ Lambda Cyhalothrin
❖ Bifenthrin
❖ Bispyribac sodium
❖ Diuron
❖ Thiophanate Methyl
❖ Tricyclazole
❖ Myclobutanil
83
Capital Market Presentation 2019
Regional Alliance Status
Regional Alliances Highlights
• Presence in 30 countries & > 100 customers through registrations
• Total 227 Dossiers submitted till Nov 2019
• Total 74 Registrations received till Nov 2019
15
105
12
227
5
74
FY16 FY20
No. of Customers Dossier Registrations
Capital Market Presentation 2019
Focus Markets
10.0
1.70.7 0.7 0.9 1.1
3.6
0.6 0.6 0.6
2.11.0 0.6
2.9
0.7
2.0
10.1
1.80.8 0.5
1.0 0.9
6.5
0.6 0.6 0.61.7
0.9 0.6
2.1
0.6
2.0
12.3
2.3
1.0 0.61.2 1.0
7.5
0.7 0.7 0.6
1.81.0 0.7
2.4
0.7
2.3
Brazil Argentina Mexico Ukraine Russia Australia China SouthKorea
Vietnam Thailand Germany Spain Poland France UK Canada
2013 2018 2023
Registration Activities
2013 : $ 30.00 USB2018 : $ 31.35 USB2023 : $ 36.80 USB
(in USD BN)
85
Capital Market Presentation 2019
Market Challenges
Regulatory Government Supply Chain
❖ Stringent Data Compliance &
regulatory guidelines
❖ Lead time for Registration
❖ Restricted product usage due to
resistance issue
❖ GM area Expansion
❖ OECD registration must for
MEENA markets
❖ “REACH” & Quality Compliance
❖ Slow Economy
❖ Distressed Farm Commodity
prices
❖ Stringent ESH norms
❖ Trade Sanctions
❖ Credit Risk
❖ Currency Volatility
❖ Trade Blocks & Trade agreements
like US-China Trade Agreements;
BREXIT
❖ Major Uncertainties in Raw
Material availability & Pricing
❖ Lead time to register alternative
source for major Intermediates
86
Capital Market Presentation 2019
Exports : A Credible Large Opportunity
Exports from India (USD Bn) Highlights
• Exports from India to grow up to 4.10 USD Bn by 2023
• Global players incrementally looking to diversify their sourcing base to India
• Strong Ethanol demand 15% as bio diesel
• Proportion of High Generic molecules in rise leading to lower IP protection concerns
• Demand for Ecofriendly / Innovative product
• Consolidation within industry
• Higher Prices of the Agriculture commodities
• Demand for high Value & Industrial Crops
• Rising Per Capita Income & demand from emergent economies in both Crop & Non crop
1.1 1.21.4
1.72.0
2.5
4.1
2010 2011 2012 2013 2014 2017 2023E
87
Capital Market Presentation 2019
IIL Exports Projections
International Sales Trend (Rs. Cr.) Growth Outlook
• In FY23 revenue to grow up to Rs 300 crs which is 16.2 % of Total Sales
• Formulation to Tech Sales Ratio 65 to 35
• APAC will contribute (33%) followed by Africa(28%) ; Middle East (15%) ; LA (15%) & Europe ( 8%) each & NAFTA( 1.6%)
• Expecting some contribution from CRAM & Biopesticides business
• Insecticides will contribute maximum followed by Herbicides & Fungicides
• Demand for eco-friendly formulation
• Focus on cost effective “ SEZ” based supply
• “2 STAR Trading House” status in FY20
12 1234
60
100
300
FY16 FY17 FY18 FY19 FY20E FY23E
88
5. ProcurementMr. Sunil Wason
Vice President Procurement
Capital Market Presentation 2019
Centralized Procurement
Centralized Procurement
Dahej Plant - 5
Shamli Plant - 7
Production WarehouseMachine
MaintenanceUtilities Assets R&D ETP Lab Safety/Security
Business Divisions
Samba Plant - 6
Udhampur Plant - 8Chopanki Technical - 4
Chopanki Plant -2
Dahej SEZ Plant - 3
Chopanki Plant - 1
90
Capital Market Presentation 2019
Procurement Spend Analysis – FY2019
65%
35%Domestic
Import
90%
7%
1%2%
Raw Material
Packing Material
Consumable
Assets
Procurement Expenses – Category Wise
Domestic vs Import
90%
4%6%
China
Japan
Taiwan
Geography
Raw Material
91
Capital Market Presentation 2019
Procurement Mix
PM Procurement Bifurcation FY 2019 Top 10 spends CHINA FY 2019
Containers (Bottles/Drums)
60.06%
C-Box 15.27%
Laminates 11.07%
Labels etc 5.96%
Cartons 3.47%
Bags 0.95% M/Caps 1.12% Misc. 2.1%
Lambda Cyhalothric Acid
27%
2-chloro-5-chloro Methyl Thiazole
11%
N-Propoxyethyl-N-2-6 Diethyl Aniline (PE
10%
2-ethylsulfonylimidazo-1,2a Pyridin
Sulf10%
3-methyl-4-nitroimino
Perhydro-1,3,5-oxa9%
Trimethyl Phosphite (TMP)
9%
4-Phenoxy-2,6-disopropy Phenyl
Isothiocy8%
4 Phenoxy -2 . 6 –Dhsopropylniline
thiour6%
Bifenthrin Alcohol
5%
Cyanuric chloride5%
92
Capital Market Presentation 2019
Manufacturer vs Trader (%)
Procurement Source
30%
37%
41%
70%
63%
59%
FY17
FY18
FY19
Manufacturer Trader
Moving from Traders to Manufacturers in China
93
Capital Market Presentation 2019
Strengths and Challenges
Challenges Strengths
❖High dependency on China
❖Supply commitment from China
❖Price volatility
❖Consistent quality
❖Strong influence of mediators/Traders
❖Disruptive new process/Technology
❖Compete and maintain China bench markingprices
❖ In-house R & D to support processimprovement issue / new technologyadoption
❖ IIL is one of the top repute company – Getspriority supplies and pricing
❖Clear vision helps in long term planning
❖Clear-cut strategy to shift from Traders toManufactures
❖Multiple sources for each items ensuring riskminimization
❖Stringent In-house quality assurance systemfor vendor selection
❖Setting up backward integration plant atDahej
94
6. Financial Performance
Mr. Sandeep AggarwalChief Financial Officer
Capital Market Presentation 2019
548396
597843
1,228
5.7%4.0%
6.0%7.8%
10.3%
FY15 FY16 FY17 FY18 FY19
PAT Margin (%)
1,110920
1,1141,478
1,856
11.5%9.3%
11.2%13.8%
15.6%
FY15 FY16 FY17 FY18 FY19
EBITDA Margin (%)
Financial Performance –Last 5 years
Strong EBITDA and PAT growth with margin improvements every successive years
9,652 9,882 9,942 10,73311,919
FY15 FY16 FY17 FY18 FY19
Revenue from Operations (Rs. Mn)
5.4%CAGR
EBITDA (Rs. Mn)
3
PAT (Rs. Mn)
13.7%CAGR
22.3%CAGR
96
Capital Market Presentation 2019
44103 131
166 172 155192
125
6960
89 6665
41
36
30
33 3834
45
30
11 1310
9
6
131 148 90
84
6689
40
70
71
15
FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 H1 FY20
Products Freshness Index
New Products launched during the year
5 5 3 2 5 5 8 5
% of Revenue from Operations
7.1% 19.9% 22.9% 30.3% 37.9% 43.1% 44.9% 47.3%
Proven track record of successful new product launches exhibits IIL’s strong R&D capabilities and continues to provide competitive edge
221
299
420
478
535
407
44
172
Revenue from new product launches (Rs. Cr.)
97
Capital Market Presentation 2019
Realization Trend
234256 260
274
353
FY16 FY17 FY18 FY19 H1FY20
Sales Rate per KG/LTR
Increasing Sales Rate Per KG Trend
9898
Capital Market Presentation 2019
Key Return Ratios
Return on Equity Return on Capital Employed Return on Asset
Consistently improving return ratios and generating wealth for shareholders
18.9%
9.8%
12.9%
15.4%
18.6%
FY15 FY16 FY17 FY18 FY19
15.8%
12.5%14.6%
20.2%
17.4%
FY15 FY16 FY17 FY18 FY19
6.0%
4.4%
6.1%
8.4%9.1%
FY15 FY16 FY17 FY18 FY19
99
Capital Market Presentation 2019
Capital Structure
Note: Capital Employed = Total Debt + Total Equity
(Rs. Million) FY2015 FY2016 FY2017 FY2018 FY2019H1
FY2020
Long Term Debt 775 519 283 145 68 34
Short Term Debt 2,409 1,514 2,060 968 2,952 2,972
Total Debt 3,184 2,033 2,342 1,112 3,020 3,006
Cash & Cash Equivalents 86 71 68 196 89 91
Net Debt 3,098 1,962 2,274 917 2,931 2,915
Total Equity 2,908 4,049 4,645 5,476 6,613 7,407
Net Debt/Equity 1.07x 0.48x 0.49x 0.17x 0.44x 0.39x
Key Highlights
▪ Higher debt in FY2019 was represents amount invested in building up higher inventory of Thimet and Nuvan
▪ Debt is expected to normalize to the range of ~150 Cr by the end of the current fiscal year with zero long term debt
100
Capital Market Presentation 2019
Cash Flow from Operations
35.0
3.9
127.1
(106.2)
FY16 FY17 FY18 FY19
Net Cash from Operating Activities (Rs. Mn)Key Highlights
• At the end of FY2019 Inventory ofThimet and Nuvan amounted toRs. ~250 Crores
• Thimet inventory to be fullycleared by the end of current year
• Nuvan inventory to be fullycleared by the mid of next fiscalyear
• Positive and growing cash flowsgoing forward
101
Capital Market Presentation 2019
R&D Expenditure Trend
12.8
0.04
4.2
14.5
0.04
30.9
14.9
34.2
39.9
46.5
4.2 5.1
12.4
40.4
62.6
FY15 FY16 FY17 FY18 FY19
Capital Exp Revenue Exp Data Generation Exp
Capital, Revenue and Data Generation Expenditure (Rs. Mn)
102
Capital Market Presentation 2019
Working Capital Cycle
Management is fully committed to improving its working capital cycle
Key reasons for high working capital Strategy
• Higher inventory for work in progress products ascompany manufactures both technical and formulations
• Lower inventory levels of finished goods• Advance purchases of intermediaries to get the better
prices• FY2019 inventory levels were exceptional due to Thimet
and Nuvan inventory
• Backward integration and reduce dependence on rawmaterial imports
• Payables days have increased as a result of new MSMepayment policy, company is committed to fund theworking capital through internal accruals i.e. withoutraising working capital loans
Working Capital Days
118
63
220
165 115
76
190 151
98 78
209 189
116 80
195 158
124 75
313 263
Payables Receivables Inventory Net Working Capital
FY2015 FY2016 FY2017 FY2018 FY2019
103
Capital Market Presentation 2019
Segment Reporting - FY2019
65%
31%
4%
B2C
B2B
Exports
55%29%
11%5%
Insecticides
Herbicides
Fungicides
PGR
Gross Sales by Product Category Gross Sales by Segment
53%47% Maharatna
Products
Other Products
Gross Sales vs Internal Consumption Breakdown of Top Seller Range in B2C
55%45%
Sales
InternalConsumption
104
7. Corporate Social ResponsibilityMr. Sanjay VatsVice President
Capital Market Presentation 2019
❖ Empowering Children & Farmers of India
❖ Rural initiatives for a sustainable living
❖ Projects around Farmer Knowledge Enhancement & Child education
❖ Farmer First Approach
❖ Millions of beneficiaries till date
❖ Employee Participation & Volunteering
CSR Vision - Empowering Sustainable Living
106
Capital Market Presentation 2019
❖Children education programs in districts of Punjab, Rajasthan, Bihar, UP and Odisha
❖Adoption of village schools
❖Distribution of books, study materials and stationeries to children
❖Empowering people with dignity and respect by organizing livelihood programs
Education Program
107
Capital Market Presentation 2019
❖Aimed at educating farmers on crop protection and judicious use of agrochemicals
❖Promoting the cultivation of 3rd crops for soil fertility and extra income
❖Organizing special camps
Signed a MOU with ICAR – IARI for training of farmers to maximize their yield & Entrepreneur ship in 2017
Kisan Jagrukta Abhiyana
108
Capital Market Presentation 2019
Insecticides Jaroori Hai
An awareness initiative of informing all the stake holders of the society about the importance, need and judicious use of agro-chemicals
• Involving the agro experts from ICAR-IARI and different universities
• Using social media to take the same to the stake holders
• Involving our industry players in the initiative
• Creating a sense of our responsibility towards farmers
Insecticidesjaroorihai.com
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Capital Market Presentation 2019
Youtube TwitterFacebook
Social Media Initiatives
Social media initiatives helps in improving the internal as well as external communication about company and its activities
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8. Growth Strategy and OutlookMr. Rajesh Aggarwal
Managing Director
Capital Market Presentation 2019
Agriculture Sector in India– FY23 Outlook
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• Farmers will look to combine crop protection, seeds, digital and application technologies while fulfilling societal requirements
India’s Population1.46 billion
Growing Middle ClassHigh demand
for calories
Limitation in Arable Land
Limited expansion
possible Climate Change
High Volatility in crop
production
• Crop protection continue to grow
• Demand for innovative Products will shape the industry
Important Characteristics
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Capital Market Presentation 2019
15%
25%
30%
30%
Capital Expenditure Plan
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Capex will be incurred in a phased manner over next 3 years and will drive IIL future growth
Capital Expenditure Plan
ChopankiBrownfieldExpansion
SEZ Phase 1 and 2
DahejBrownfield Expansion Phase 2
DahejBrownfield Expansion Phase 3
CapEx outlay of Rs. 150 crore for next 3 years
❖ Out of Rs. 150 Crores, already incurred Rs. 32 Crores ofCapex for setting up SEZ unit at Dahej. SEZ will resultin increased expanding our exports to newergeographies
❖ Remaining capex will be incurred in a systematicphased manner
❖ Chopanki Brownfield Expansion – Expanding existingfacility to add new manufacturing lines to producehigh value products
❖ Dahej Brownfield Expansion – Setting up backwardintegration plan to reduce dependence on importedraw materials and reduce cost of sales
❖ These investment will yield result in long run and willenhance IIL overall capability to manufacture highvalue product, complex molecules and facilitateexports into new geographies
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Capital Market Presentation 2019
Growth Plan FY2023
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Phasing out the generic products and introduction of new products in Maharatna category will
significantly grow topline and bottomline by FY2023
Revenue Growth
FY19 FY20 FY21 FY22 FY23
Current Portfolio New Launches
11-13%FY19 – FY23E CAGR
❖ Revenue is expected to grow by 11-13% CAGR in FY19-23 period
❖ The topline growth will be primarily driven by recent andupcoming innovative product launches
❖ Maharatna products will constitute more than half of sales bythe end of FY23
❖ Exports will grow three times from current level, contributing~ 15% of the sales as compared to ~5 of sales in FY19
❖ Identified 25 products which are in the process of tail cuttingand with new product launches every year will ultimatelyresult in better product mix and improved margins
❖ Efficient working capital management and backwardintegration of key intermediaries will result in enhancedbottom line
Capital Market Presentation 2019
Building Blocks of Growth
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Backward and Forward Integration
R& D will results in New product launches in Maharatna Category
Focussed Approach on Biologicals Optimum Capital Structure and Operational Efficiency
• Moving on the strategic path of backward and forward integration
• Capitalize on the Make in India initiative
• Will result in better margins across technicals and formulations
• Focus on sustainable generation of cash flows
• Capex of Rs. 1.5 bn in next 3 years in a phased manner for setting up SEZ, synthesis facilities and backward integration plant
• Focus on in-house R&D and international partners to launch new products
• 28 registrations are in pipeline out of which 22 registrations are in 9(3) category
• Developed and commercialized VAM (Vaslcular Arbuscular Mycorrhiaze)
• Developed and commercialized soil energizer, Kayakalp
• Development of 3-4 new biological products is in pipeline
Phase out Generic Products
• Phasing out the Generic Products (high volume-low margin)
• Introduction of new products in the Maharatna category and moving up the value chain
Exports
• Working on registration in new countries with 100+ export agreements
• Expanding in new geographies:Exporting to 20+ countriesExpand to 50+ countries and 100+ customers by the end of FY2023
Capital Market Presentation 2019
Thank You
For further information, please contact:
Sandeep AggarwalChief Financial OfficerInsecticides India Ltd.
+91 11 2767 [email protected]
Ravi Gothwal / Vikas LuhachChurchgate Partners
+91 22 6169 [email protected]
Insecticides (India) Ltd.(CIN: L65991DLl996PLC083909)
401-402, Lusa Tower,Azadpur Commercial Complex,Delhi - 110033
Telefax: +91 - 11 - 27679700 - 04 (5 Lines)
[email protected] | www.insecticidesindia.com